Dogecoin Explained – Here’s What You Need to Know
Meta Descriptions: Are you looking to invest in the CFD market and purchase Dogecoin? Find out what makes it so attractive and what to expect from future prices.
Cryptocurrency remains a somewhat quirky concept, but it’s gradually making its way into the mainstream. Slowly being accepted as a valid form of payment by an increasing number of places, cryptocurrency has forged a niche for itself as a legitimate alternative.
Bitcoin is arguably the best known of them all, but many other cryptocurrencies are available, too, such as Dogecoin. With its humorous design and accessibility, this altcoin has gradually built up a following. But what is it exactly, and what do you need to know?
Trading with Dogecoin
Dogecoin is a type of cryptocurrency, also known as a digital currency. Although you’ll never physically hold a coin, cryptocurrency can be used to pay for a wide range of options. There have even been instances of people buying a house entirely with cryptocurrency!
It’s not just everyday purchases that can be made with this cryptocurrency; it can also be used for trading. If you are interested in a CFD when trading cryptos like Dogecoin, there’s no difference to your standard market procedure. Opting for a CFD rather than outright ownership of the currency allows you to benefit from all of the price movements without the additional complications of ownership.
Is It a New Cryptocurrency?
There has been a lot of interest in Dogecoin recently, with certain celebrities and stars lining up to endorse it. Rapper star Snoop Dogg and Tesla founder Elon Musk tweeted their support for the product, and demand went sky high.
The altcoin was originally launched in 2013, and it was intended to be a lighthearted approach. Created by an IBM developer and a data scientist in a matter of hours, it was meant to be a humorous cryptocurrency and not taken seriously.
Fast-forward to 2021 and this crypto isn’t the joke that was anticipated, but a genuine contender. In the top 10 cryptocurrencies, Dogecoin has been mainly used as a way of tipping content creators via social media platforms.
The Rise of Dogecoin
The fortunes of cryptocurrency have been on the rise in recent months, with Bitcoin hitting record highs at the tail end of 2020. The sentiment is contagious, with appetite spreading through the sector to other cryptocurrencies such as Dogecoin. However, Dogecoin, in particular, has enjoyed a boost, and that’s thanks to social media chatter.
When Elon Musk tweeted his support for the coin, describing it as “the people’s crypto”, the price rocketed by 50%. Further accolades from Gene Simmons of Kiss and rap star Snoop sent the cryptocurrency even higher.
The fallout from the GameStop saga also benefited the coin, with amateur investors looking for an alternative vehicle for their cash. Frustrated by attempts to block their move to increase the value of GameStop, the focus has switched to Dogecoin with a concerted campaign intent on driving up the price.
What helps Dogecoin is that it has no cap on the number of coins which can exist in circulation, unlike other cryptocurrencies. At launch, there were 100 billion coins, but by 2015 these had all been mined. A further 5 billion were issued, with a decision to issue another 5 billion every year.
This offers real potential for investors and for the currency to continue to grow. Although it’s only accepted at selected places right now, who knows what the future of this friendly cryptocurrency holds?